Question
I currently have a portfolio of 20 unit trusts to the value of approximately £160,000. 18 of them are held within ISA's split between the Fundsnetwork and Cofunds platforms. All were purchased via Bestinvest who have acted for me in a non-advisory capacity.
Bestinvest are now keen for me to transfer my holdings to their "Select" service. However, having read your excellent 'Guide to ISA Discount Brokers', I believe that transfering my holdings to Interactive Investor may be my best option as they rebate all the trail commission and also I already have a share dealing account with them. I want to transfer the holdings "as is" so that they are not out of the market for any length of time. I am aware that I can't do this from Fundsnetwork until 2013 but don't mind waiting till then to transfer all my funds at once.
Something that concerns me, given that I have a total of 20 different unit trust holdings, is the potentially high cost that Bestinvest may charge for the transfer. Unfortunately I have been unable to discover what their transfer charges are and wondered if you had any idea? I know that the transfer charges from their "Select" service are £25 per asset plus a £50 ISA closure fee but I cannot find anywhere that tells me what the transfer charges from their non "Select" service are.
Also do you know if there would be any transfer charges incurred from Fundsnetwork or Cofunds. I can find nothing in their terms and conditions that says that there would be but wondered if you know otherwise?
Also just a quick thank-you for your unbiased, independant site and especially the articles on the RDR which I have found most enlightening. Answer
Under your current service Bestinvest simply acts as broker for the funds held on the Cofunds and FundsNetwork platforms. This means Bestinvest doesn't levy any charges of its own, but receives trail commission from the two platforms, probably around 0.5% of the value of your funds each year.
This gives you two options. The simplest would be to appoint another discount broker as the 'agent' for your funds. All this requires is signing a simple form or letter confirming the change, after which the trail commission will divert to the new broker but the funds remain untouched with Cofunds and FundsNetwork. Cavendish Online rebates all FundsNetwork trail commission with no explicit fee (they receive 0.05% from FundsNetwork). Otherwise Massow's rebates all trail commission from both platforms in return for a one-off £125 fee (provided the commission can be rebated into your investments, which in case of these platforms it can).
The alternative is to transfer the funds to another platform, as you've mentioned. This requires funds to be 're-registered' (also known as an 'in-specie' transfer) in order to keep them 'as is' and avoid having to sell then repurchase. Cofunds allows re-registration of funds held outside of an ISA to other platform but (at time of writing) still doesn't allow ISAs to be re-registered, despite the FSA requiring all platforms to offer this option by the end of this month. FundsNetwork is also inflexible, only allowing non-ISA funds to be re-registered where the total transfer exceeds £40,000 and excluding all non-Fidelity funds from ISA re-registration. Where re-registration is allowed, neither platform (nor Bestinvest) currently charges for this.
I would expect both to adapt their policy in line with the FSA's requirement by the end of the month (although they'll likely drag their heels until the last minute), but until then it's a far from satisfactory situation.
It's worth noting that Interactive Investor uses Cofunds for the fund part of its platform, so it should certainly be possible to seamlessly move your existing funds held via Cofunds from Bestinvest to Interactive Investor. I'd give Interactive Investor a call and ask them how they'll facilitate this.
As for FundsNetwork, if you have non-ISA funds in excess of £40,000 you can re-register now. Otherwise this facility should be available by next month. I'll update when there's some news.
Glad you like the site and you find it useful.
I currently have a portfolio of 20 unit trusts to the value of approximately £160,000. 18 of them are held within ISA's split between the Fundsnetwork and Cofunds platforms. All were purchased via Bestinvest who have acted for me in a non-advisory capacity.
Bestinvest are now keen for me to transfer my holdings to their "Select" service. However, having read your excellent 'Guide to ISA Discount Brokers', I believe that transfering my holdings to Interactive Investor may be my best option as they rebate all the trail commission and also I already have a share dealing account with them. I want to transfer the holdings "as is" so that they are not out of the market for any length of time. I am aware that I can't do this from Fundsnetwork until 2013 but don't mind waiting till then to transfer all my funds at once.
Something that concerns me, given that I have a total of 20 different unit trust holdings, is the potentially high cost that Bestinvest may charge for the transfer. Unfortunately I have been unable to discover what their transfer charges are and wondered if you had any idea? I know that the transfer charges from their "Select" service are £25 per asset plus a £50 ISA closure fee but I cannot find anywhere that tells me what the transfer charges from their non "Select" service are.
Also do you know if there would be any transfer charges incurred from Fundsnetwork or Cofunds. I can find nothing in their terms and conditions that says that there would be but wondered if you know otherwise?
Also just a quick thank-you for your unbiased, independant site and especially the articles on the RDR which I have found most enlightening. Answer
Under your current service Bestinvest simply acts as broker for the funds held on the Cofunds and FundsNetwork platforms. This means Bestinvest doesn't levy any charges of its own, but receives trail commission from the two platforms, probably around 0.5% of the value of your funds each year.
This gives you two options. The simplest would be to appoint another discount broker as the 'agent' for your funds. All this requires is signing a simple form or letter confirming the change, after which the trail commission will divert to the new broker but the funds remain untouched with Cofunds and FundsNetwork. Cavendish Online rebates all FundsNetwork trail commission with no explicit fee (they receive 0.05% from FundsNetwork). Otherwise Massow's rebates all trail commission from both platforms in return for a one-off £125 fee (provided the commission can be rebated into your investments, which in case of these platforms it can).
The alternative is to transfer the funds to another platform, as you've mentioned. This requires funds to be 're-registered' (also known as an 'in-specie' transfer) in order to keep them 'as is' and avoid having to sell then repurchase. Cofunds allows re-registration of funds held outside of an ISA to other platform but (at time of writing) still doesn't allow ISAs to be re-registered, despite the FSA requiring all platforms to offer this option by the end of this month. FundsNetwork is also inflexible, only allowing non-ISA funds to be re-registered where the total transfer exceeds £40,000 and excluding all non-Fidelity funds from ISA re-registration. Where re-registration is allowed, neither platform (nor Bestinvest) currently charges for this.
I would expect both to adapt their policy in line with the FSA's requirement by the end of the month (although they'll likely drag their heels until the last minute), but until then it's a far from satisfactory situation.
It's worth noting that Interactive Investor uses Cofunds for the fund part of its platform, so it should certainly be possible to seamlessly move your existing funds held via Cofunds from Bestinvest to Interactive Investor. I'd give Interactive Investor a call and ask them how they'll facilitate this.
As for FundsNetwork, if you have non-ISA funds in excess of £40,000 you can re-register now. Otherwise this facility should be available by next month. I'll update when there's some news.
Glad you like the site and you find it useful.
Read this Q and A at http://www.candidmoney.com/askjustin/776/how-to-move-isas-from-bestinvest-to-another-platform
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